6A: periodic system under FIFO Flashcards
how to calculate cost of goods sold
number of units purchased * purchase price + beginning inventory
steps on calculating cogs in FIFO
1) APPLY FIFO: multiply the units in ur inventory * unit cost
(these are the items that are purchased the latest)
2)Subtract Ending Investory from cost of goods available for sale = cost of goods sold
where do you apply FIFO in calcualting cogs?
STEP ONE!!
Under FIFO perpetual or periodic system, what values are the same
the same cost of goods sold and the same ending inventory
As long as its the same country or safe year, under FIFO, wether it is perpetual or periodic the values are the same
Periodic system under average cost, how to calculate weighted avg unit cost
cost of goods available for sale/ units available for sale= weighted avg unit cost
what is the formula for calculaiting COGS under the periodic system under avg cost
cost of goods available for sale- ending inventory= cogs
where do you apply average inventory formula in periodic system
step one!!
if same company, same year, will the cogs and ending inventory be the same under avg cost and —- be the same
no!! they wont be the same
